Improvements To Increase Broward`s Debt

Broward County`s debt amounts to about $317 for every man, woman and child in the county, and it is about to increase dramatically as officials embark on a borrowing spree.

In the next few weeks, financial consultants will be hired to organize and market a $117.7 million bond issue approved by voters Nov. 4 to pay for new and renovated courtrooms and a sheriff`s headquarters and public safety building.

It will cost an estimated $324 million to repay the loan, or $16 a year for 30 years for the owner of a $75,000 home with a $25,000 homestead exemption.

That burden will be added on property tax bills to the cost of paying off loans dating back to 1976 that helped build or improve roads, libraries and jails.

But government financing experts say Broward has a relatively modest debt, and county officials complain that is part of the reason that its bond rating isn`t higher. The rating helps determine what interest will be charged on a loan.

``If you look at comparably sized governments, be they cities or counties of similar population,`` said David Brandt of the West Palm Beach consulting firm Florida Municipal Advisors, Broward County ``is in the low end of the range.``

The per capita debt in Dade County is $499 and in Palm Beach County it is $230.

In Broward, the cost of paying off the debt on previous loans has risen from 3.5 percent of the general budget to 11.4 percent since 1980, records show.

On Tuesday, the Broward County Commission will set up a negotiating committee to hire investment bankers and financial advisers to help issue the bonds. The selected firms stand to share a potential commission of more than $4 million.

The last time the county undertook such an effort, it was to refinance -- at a lower interest rate -- $229.4 million in previous loans. Several firms, including Paine Webber, E.F. Hutton and Dean Witter, split $3.1 million from the transactions, and the financial adviser, Bear, Stearns, was paid $152,172.

At least 44 firms are expected to compete to undertake the newest job.

``Any time you have an issue the size of Broward,`` Brandt said, ``you`re going to at least attract the interest of all the regional and state firms.``

That interest preceded the bond issue. During their election campaigns, Commissioners Scott Cowan, Nicki Grossman and Sylvia Poitier received campaign contributions of almost $30,000 between them from investment banking firms.

One of the jobs of the new financial team, said county Finance Director Phil Allen, will be to help the county improve its bond rating. Currently, the rating is lower than Palm Beach County`s and the state of Florida`s.

Allen said the rate is not as high as it could be because rating services want evidence that fast-growing areas like Broward are dealing with their own needs.

He said the 3-to-2 voter approval of the bond issue for courtrooms and the public safety building is the kind of evidence the county plans to use to make its case that taxpayers are willing to shoulder the high cost of local growth.